1947

This year, the United States’ Reconstruction Finance Corporation (RFC) co-financed construction of a gambling enterprise via its $975,000 loan for the Mapes hotel-casino in Reno, Nevada.

Under Attack

Three years later, Senators William Fulbright (D-Ark.) and Paul Douglas (D-Ill.), members of a committee investigating the RFC’s past lending practices, publicly criticized the group for using federal funds for what included a gambling enterprise and for doing so knowing two of its operators — Louis “Lou” J. Wertheimer and Bernard “Bernie/Mooney” Einstoss — had ties to the underworld. Further, in making the loan, the RFC had overruled the determination of the San Francisco office and Washington RFC review committee not to grant it. The loan went through.

It was “poor public policy” for the RFC to help “big-time gambling,” Fulbright said (Nevada State Journal, July 4, 1950). “It’s a very serious matter to involve public money with characters of this kind.”

Intended Use

The federal government had established the RFC in 1932 to boost the country’s confidence, recapitalize banks and stimulate loans during the Great Depression. The corporation was to help state and local governments finance public works projects and provide loans to banks, businesses, railroads and agricultural entities.

With respect to the Mapes’ financing, RFC officials argued that in places like Reno where gambling was legal, loaning money to a hotel with a casino was no different than doing so for a hotel with a bar. They argued that the casinos’ profits were minor and, therefore, irrelevant. They insisted the Mapes loan was sound and in the public’s interest, and collateral was ample. They denied knowing about Wertheimer and Einstoss’ mob connections.

Douglas agreed the loan was legal but questioned its ethicality. He countered that the gambling areas generated 98 percent of the Mapes’ net profits.

Ultimate Fate

The federal government disbanded the RFC in 1957. The Mapes closed in 1982.

Sources

1934-1935

Today, 80 years later, the circumstances of actress Thelma Todd’s death remain a mystery, and the case still is one of Hollywood’s infamous unsolveds.

A deep cover-up precluded the truth about the incident from surfacing. On December 16, 1935, the famous, 29-year-old blonde was found dead in her garage, her beaten, slumped body behind the wheel of her brown phaeton. The cause of her death was ruled accidental carbon monoxide poisoning from her car’s engine.

One theory behind the fatal event, however, purported in the book, Hot Toddy, is that the powerful Mafioso, Charles “Lucky” Luciano, had her murdered. He wasn’t just a low-level syndicate soldier. He was a boss, the first official head of the modern Genovese crime family, and made his mark in New York by splitting the city into five such dynasties. Meyer Lansky and Benjamin “Bugsy” Siegel were associates.

Luciano and Hot Toddy, as friends nicknamed her in her youth, began a casual relationship that evolved into a sexual dalliance by 1934. That year, the actress and her friend and neighbor, Roland West, opened a restaurant called Thelma Todd’s Café.

Exploitive Ulterior Motive

Luciano wanted to lease the top floor of her eatery to run a gambling club there, where he believed the wealthy Hollywood stars who frequented her café would spend lots of money. At the time, only poker and other player-against-player card games and horse race betting were legal in California. He sensed the strong-willed Todd wouldn’t permit it, so he employed devious tactics to get her to comply.

Luciano sent some of his goons to torment and wear down West, who managed the restaurant. They forced him to change vendors to those controlled by the mob and siphoned money from the business. As for Todd, Luciano got her addicted to speed, hoping it would make her submissive and willing to do whatever he wanted.

Over time, Charley Lucifer, as he was sometimes called, realized Todd was not a pushover, and she learned more and more about his underworld dealings. Their relationship deteriorated, and they saw each other less and less. Eventually, Todd started dating a businessman from San Francisco with whom she was infatuated.

Meanwhile, Luciano’s underworld nemesis in town, Frank Nitti, threatened to horn in on his interests — prostitution, gambling and drugs. Already, Nitti had shut him out of his shakedown of the movie industry after agreeing to include him. Consequently, to maintain an empire in Los Angeles, Luciano believed he needed Todd’s café more than ever.

He approached her with his plan. Despite knowing that refusing Luciano of anything could, and likely would, get her killed, she said no. For that, he saw her as a problem. He tried to persuade her to change her mind by other means, like having menacing men sit in the restaurant all day every day. Around Thanksgiving in 1935, he again pressured her face to face, to no avail.

“Toddy later told friends Luciano had wrangled with her all night about giving him the storage room for gambling,” wrote Andy Edmonds, the author of Hot Toddy. “He was insistent and vowed he would not walk away without the papers. They had argued violently in the car, Thelma refusing to give Luciano what he wanted.”

Luciano informed her that as of January 1, 1936, he’d be operating a gambling club on the third floor of her restaurant despite her protests.

Todd, though, remained resolute in her refusal to allow it. To thwart his plan, she turned the space into a steakhouse and opened it before he could move in.

The Slippery Slope

In early December, she called the Los Angeles district attorney’s office to relay what she knew about Luciano’s underhanded dealings and connections to other mobsters. She didn’t tell the person who’d answered the phone what her business was, only that she wanted an appointment to speak to the D.A. Little did she know that he was under Luciano’s control and that Luciano had an informant in the office.

In mid-December, Luciano insisted she go to dinner with him. She said no, but he forced her to join him. He took her to a secluded home where he grilled her about her knowledge of his “business” and what she’d told the D.A.’s office. She tried denying she knew anything, but Luciano knew better, became enraged and slapped her hard.

Todd spilled it all. Then figuring she was as good as dead, she purposefully provoked his fears of getting arrested for past actions and losing his foothold in the City of Angels. She claimed she’d hidden evidence, including photos, of his underworld operations and that she’d snitched on him to the FBI — both of which were bluffs.

Irate, Luciano made a phone call, in which he supposedly ordered a hit on Todd, drove her to a Christmas tree lot at her request where she picked out a tree then dropped her off at her home around midnight.

In the morning, her maid discovered her dead in the garage. Luciano left Los Angeles later in the day and never returned.

Sources

1919 Elgin Six

1920

Some shady business went down between Felix Turillas, Sr., who owned Reno’s Espanol hotel and who went on to own several Northern Nevada casinos, and two men, Joe Musso and Joe Stropin.

According to Turillas, the men, whose names he didn’t know, offered to sell him an Elgin Six, or “The Car of the Hour,” for $1,750, and he expressed interest in buying it. He offered a check, but they demanded cash.

He withdrew the money from the bank and met the two for a driving demonstration of the car. After they tooled beyond the city, they persuaded him to get out of the roadster while they repaired a made-up problem with it.

One of the duo aimed a pistol at Turillas and instructed him to hand over the money and walk away. Turillas did, and the alleged perpetrators drove off. The alleged victim immediately reported the incident to the sheriff’s office.

About three days later, law enforcement officers found Musso and Stropin in Ely, Nevada with $1,700 and the Elgin Six. They arrested and returned them to Reno, where they were charged with robbery.

Musso and Stropin’s story, as told to a judge and jury, was they hadn’t robbed Turillas. Rather, they’d sold him a 50-gallon barrel of liquor at $35 per gallon. (Keep in mind, this just after Prohibition started, and despite the ban, liquor flowed freely in Reno due to mob protection.) And they’d diluted it with 15 gallons of water, which presumably angered and led Turillas to file a false lawsuit against them.

The defendants claimed Turillas had given them the keg to fill, which their attorney offered as an exhibit, and had done so five times before. Turillas denied both accusations.

Who would you have believed?

The jury deadlocked, with eleven for acquittal and one for conviction. Therefore, the judge dismissed the charges against Musso and Stropin.

Sources